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CS Professional · CSR and Social Governance · Contribution of Non-Corporate Entities in Social Governance

Lokshakti Foundation, an NGO, has a board consisting of the founder, her spouse, her brother and her nephew. It has no independent member, no written conflict of interest policy and no regular meetings. Which governance concern is most directly raised?

The main concern is the lack of independent oversight and a real risk of conflicts of interest. A board of close relatives with no conflict policy and no meetings cannot provide effective checks, so accountability and transparency in decisions are weakened.

  1. AAbsence of independent oversight and risk of conflicts of interest in decision-makingCorrect
  2. BViolation of the rule that an NGO must have at least ten trustees
  3. CAutomatic loss of its non-profit status because family members serve on the board
  4. DMandatory conversion into a company limited by guarantee

Explanation

A family-dominated board with no independent member, no conflict policy and no meetings weakens checks and balances, so self-dealing and weak accountability are the central risks. No rule fixes ten trustees, and family membership does not by itself cancel non-profit status or force conversion.

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